Should the Postal Service continue its consolidation plan?

Network consolidation will return in January 2015, a year after going on hiatus. The U.S. Postal Service announced recently that it would resume consolidations, closing up to 82 mail processing facilities. This second phase of the network consolidations should be done prior to the 2015 fall mailing season.

The Postal Service expects the changes to yield $750 million in annual savings and to affect about 15,000 employees. In 2012 and 2013, the Postal Service consolidated 141 mail processing facilities, resulting in cost savings of about $865 million.

Loyal readers of our blog will recall that the Postal Service put its network consolidation plans on hold in early 2014 while it reconsidered its proposed changes to service standards for First-Class Mail. (See our blog from earlier this year on the delay.) Phase two will affect the service standards for First-Class Mail and Periodicals as well, eliminating the overnight standard for most First-Class Mail. Periodicals service standards would range from 3 days to 9 days, versus the current 2 to 9 days.

The Postal Service says eliminating excess capacity through consolidation is one of the few options it has to cut costs. Consolidation will also allow the Postal Service to establish a “low-cost, technology-centric delivery platform necessary to serve the mailing and shipping industry for decades to come.”

Still, the planned consolidations are likely to rankle some. At least one postal union has already come out strongly against the plan, saying it will degrade service and lead to mail delays. It intends to vigorously fight the closures. On the other hand, industry has generally supported Postal Service efforts to reduce costs and improve efficiencies, as long as service isn’t irreparably harmed.

We welcome your thoughts. Should the Postal Service continue with consolidations given the decline in mail volume and the potential cost savings? Or should the Postal Service first explore ways to use the excess capacity to provide services that might yield additional revenue sources, such as warehousing or other logistics services?

Comments (167)

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I think the Post Office should STOP all consolidations! What happened in my Office is a JOKE!!!! . The Operating cost has to be OUTRAGEOUS, with extra trucks, empty trucks, overtime hours, stand-by time for carriers probably isn't close to the cost they said it would be. They need think about what there doing!

As a business man, when a customer mails a check from Cape Girardeau Mo to Paducah and it already takes 7-10 days to get it, something is slowing down the mail well past stated and expected delivery standards already. Additional consolidations will only make it worse.

If we cut to the chase... The USPS is a business and needs to be ran like one. It needs to consolidate if it's losing money. The answer might even be that it needs to be sold off by the government and become a publicly held and traded business.. It's just doesn't work financially being a government institution.

Want to reduce postal costs? Increase delivery time by one day and do all the processing work between 6am and 6pm, stop processing mail on Sunday, and reduce manager's pay.
There is so much money being wasted by forcing employees to work during night shifts between 6pm and 6am just to get the mail delivered one day faster. There is also a lot of waste by processing mail on Sunday. Each employee who works between 6pm and 6am gets a "night differential" of 10%. For working on Sunday, the employees get an extra 25% as well.
Let's give the employees a break, take them off the night shift and Sundays and let them have some time with their families.
By consolidating facilities, you would have the same impact on mail delivery because of the extended (or over extended) service areas, but you will still have the problem of processing postal employees never seeing their families or having lives outside of the post office.

The Postmaster General is acting to destroy the agency he is supposed to lead. He should be investigated and hopefully fired for his misstatements (lies). He seems bent on destroying the morale of his hardworking employees and catering to the naked greed of the privatization interests in Congress. If the Postal Service is privatized it will be another victory for the profit-hungry rich, and the public will be poorer for it.

The congress should end the requirement by George Bush to prefund the retirement funds for your employees! Then the plan to privatize would be stopped in it's tracks and the PO would be in good shape again.

The USPS top level management is driving business away. All we do is service so they close offices or shorten window hours. We take up all of the blue collection boxes so the customer does not have convenient access. And every other form of service is reduced or "studied" for elimination. They (USPS mgmt.) say 85 % of cost is labor. Perhaps that is true. With and structure like it has. Postmaster; Deputy PM: 40 Vice presidents and approximately 100,000 EAS management level employees all receiving a salary and benefit package over $100 thousand per year. The VP make $199,000 plus benefits so someone do the math on this.

I work in the rocky mount nc plant.200 miles from the coast.all coastal mail came to us.now its going to Raleigh.a majority of the time they are sending the mail to Greensboro..on the heavy days and Mondays after holidays it is being sent to Tennessee.we are sending mail 9 hrs away from where it used to go..cost savings I don't think so

Some of the plant closures make no sense. My favorite example is Norfolk VA. Six of the top ten demographic areas in Virginia are in the Norfolk-Hampton Roads-Virginia Beach area. The idea of sending that mail to Richmond will not appeal to anyone who has ever sat in traffic on I-64. Are we really going to tell a huge chunk of Virginia that USPS doesn't care about service to their area?

Consolidating and closing facilities is not the answer. Our Postal Service was created in 1775 by an act of the Second
Continental Congress. From its inception, the men and women who have worked for the Postal Service have dedicated themselves to delivering the mail to every address in the country in a timely manner. Through hail, rain, sleet, or snow the Postal Service delivers. Each day I look forward to going to my mailbox and finding that my carrier has delivered my mail on time. I appreciate my mail carrier and I am glad that he is around in my neighborhood. The Postal Service is a an important part of the fabric of this nation. Linking our citizens together in personal ways. The carriers who deliver your mail are the eyes and ears to the community. When they deliver to each address, day in and day out, they become aware of who their customers are and are able to tell if something isn't quite right. I have read countless stories, of Postal Service employees saving lives and preventing sudden calamitous events from happening in neighborhoods across the country and its territories. Postal Service employees are very active in their communities and help with numerous charitable events. But the Postal Service is changing and with it the service and protections we now enjoy. Unfortunately, there is an element in this country that is driven by greed instead of doing what it right for the American people. A ruse is being played on the American people that the Postal Service is losing money. That is why the Postal Service must close and consolidate facilities and cut staffing. Don't be fooled! The real reason is that some members of Congress have been lobbied and are being bankrolled by private interest groups. They don't want to make changes to the Postal Service that would fix it. Stopping the 5 billion dollar a year mandated on the Postal Service to prefund requirement health care for 75 years, allowing new services like postal banking, or refunding billion dollar over-payments to the Office of Personnel Management for Postal Service retirement accounts. Most republicans and some Democrats in Congress want to take a long-standing public service and privatize it. That is why there hasn't been any postal bi-partisan reform legislation to fix the problem. They want to bring the Postal Service to its knees and have the American public believe that closing and consolidating facilities is the right thing to do. Ask yourself this, do I want a privately owned Postal Service where its workers will not make a decent wage to raise a family on and have no benefits or workroom protections? Do I want a cluster box on every street where I have to go to get my mail or pay a high fee to have my mail delivered to my home address? Do I care who delivers my mail or do I want a trusted Postal Service government employee who will protect the sanctity of my mail? I think you get my point. We need to let our elected officials know that we don't want to dismantle the United States Postal Service but keep it intact so we can enjoy the services we have come to expect.

Last year I moved across the state of Indiana from the eastern side to the west side. For over 35 years I have been mailing packages to Texas for Christmas and last year was no different except it took 2 weeks longer for my packages to go a shorter distance. After asking at my new post office I was told that my packages were sent to the mail processing facility in Cincinnati, Ohio for processing due to closures. How is this aiding in making the post office more efficient? This doesn't make sense to send it back east so it can be sent west! And people wonder why the post office is losing business?!?

The only thing that the PMG has managed to do is give the postal service negative reputation, close facilities unnecessarily,
reduced the workforce in an unbalanced manner, slashed customer service so badly that most people no longer TRUST in the UNITED STATES POSTAL SERVICE! DESTROYING the Postal service all together. The image of the postal service today is that nobody even wants to work for them. It use to be a job that had decent wages and retirement now you have to work 3-5 years with 0 benefits..Really???

The Postal Service is going about the entire consolidation the wrong way in my opinion. The route we are taking is an end to service instead of fixing it.
Upper management wants to consolidate small mail processing plants into larger ones. Mail will be moved greater distances, taking more time to process and lowering standards to accomplish. When mail is postmarked from another city, other than local areas, mailers think twice about using the USPS to ship. This has been discussed in almost all of the consolation meeting held for the public.
The same holds true with contract stations. They are fine for certain types of mail but when security issues are involved mailers avoid using them.
The Post Offices footprint is also its ticket to survival. Automated equipment (that moves the mail within the plant) has been geared to larger plants and has not been developed and engineered to work in smaller facilities. With todays technology this should easily be overcome. The small plants that have been converted to automation have been done so in a patchwork manner that doesn't work but ensures their failure. Delivery Bar Code sorters, Advanced Cancellers and individual machines work fine in small plants but automated feeding and conveyor systems systems need to be engineered to smaller plants.
Instead of consolidating small plants into larger inefficient giants, which are sometimes bottle necked with outdated buildings located in large cities with traffic congestion problems. We need instead to build on our strengths and keep smaller places that work The entire process is heading in the wrong direction.
The USPS needs to consider cutting the size of already smaller plants by either finding smaller buildings (to rent or buy), partitioning off existing buildings, or adding processing equipment to Post Offices. With today's technology - machines almost can be moved overnight. This also doesn't create such a big problem moving personnel and damaging local economies.

USPS needs to improve service not weaken it! The first class stamp makes millions of dollars for the agency. It is a trillion dollar business. If your going to weaken the strength of the stamp then you must reduce the stamp to 21-cents as most people will not get the same service as the metropolitan areas! Post office should get rid of all the contract stores & sell other items at real post offices!

What you are doing to the USPS should be a crime! I have seen the privatized system and it is not pretty. It now takes over a week for a letter to get halfway across the country where before it took only a couple of days. I believe someone up there is getting big bucks to ruin the ONE service this country has and doesn't cost the taxpayer a penny. You should be ashamed of yourself Mr Donahue. And please let me know the real reason why the USPS needs to pay for 75 years of medical benefits in advance. I really want to see how you justify that.

I work as an electronic tech for 30 years and I'm also a Union Steward.
Our main facility is already filled to capacity and can't process any additional mail on time unless the service standards are reduced.
Consolidating two more plants into the main plant would create a gridlock and the mail would stop flowing i.e., the automated conveyor system will be over loaded with mail. The machines won't have any place to store the mail after the mail is processed on them. Mail will back up on the incoming docks and the mail trucks will back up on the streets.
It would be like rush hour when the traffic slows down to a snails pace because the streets can't handle the volume of city traffic, except the rush hour at the mail processing plant would virtually be 24 hours long.
It's a plan to delay the mail and that will probably have a negative impact on the economy.
Is it a good plan?
I guess it is if the only goal is to fail.

The Post Office and it's political partners need to stop this manufactured crisis of the Post Office. First make the financing of the retires medical fund more financially responsible for the continuance of the Post Office and good of the public. Second, just like any other going concern we need to raise the postage according to the financial needs at the time. Third, we need to expand services to meet the needs of the changing times and bring more revenue in.
Cutting services just makes the the Post Office look and run poorly. We the public really appreciate and need the Postal Service to continue. I can not trust Staple employees to provide the great care , knowledgable service and the safe keeping of the mail. It will be like some other countries where the mail service is substandard and mail gets stolen or takes forever to deliver sometimes intact and not. USA has great mail service and safe. Let's keep it that way.

Consolidations increases unemployment in our country, and prevents younger employees from progressing. Not only that but now the work load for employees specifically the newer ones will be twice as hard for half the pay. This will then create a divide within crafts, lower worker morale and degrade quality of service. The answer is now downsize, the answer is informing the public and encouraging the people to use USPS. Management should also stop spending money on MSP scans, paper, disabled workers who have not worked in 20 years, they could start reusing paper, using energy efficient lights, hybrid vehicles, etc. All in All the worse idea in the world is to cut the work force but give management a pass, if you cut us, cut them too.

My duty as a letter carrier for the past 30 years has been to deliver mail in a timely and accurate manner. Anything less would not be serving the customers need and expectation. To close facilities would slow delivery and drive frustrated customers away from our service. It is a needed and expected to be timely as possible To relax standards is doomed to create loss of business . Package delivery is growing,not one of my customers has ever requested slower delivery. My hope is management and Congress will recognize the importance of keeping facilities operating to expedite accurate and efficient delivery expected by the public at large.

Why should they consolidate to save money because what they save the President keeps on spending everywhere but in the USA .Things should stay the way they were an ask the workers their opinion of how we all could help save the Postal Service. It would take for every for the mail to get where it needs to go if they consolidate .s

This ill-advised plan will drive away & annoy customers.. It will cause more people to pay their bills online! Especially ones who mail the last minute! I could imagine tax time would be a disaster!! I am against this senseless idea!!

there needs to be a slower progression in this movement it's easier to correct errorssuch as would be the case of moving the processing for Eureka Ca to Medford Oregon. Wednesday we're here for public input they brushed aside concerns have not proven that they have look into them. Humboldt County situation with our locati situation with our location. There are permanent highway closures sign that are used on a regular basis on the routeprofessional truckers have stated that the road is treacherous and many places they have to stay on their CBs because they cannot pass another truck in certain areas's because they cannot pass another truck in certain areas. they should take a certain amount of mail and do a test on transportation to and from Medforwhich should include the cost and the delay in mailing before it is approved

The downsizing has already destroyed some of the service standards and this causes mailers to use other services and thereby causes a loss of revenue. Further downsizing will further downgrade the service standards and cause more loss of revenue. Th e USPS cuts down on the workforce but continues to increase the number of managers. In our office we had 2 managers over 37 workers and we now have 2 managers over 16 workers. Nation wide over 200,000 clerk craft jobs have be abolished but the number of managers has increased.
Postal management needs to understand that downsizing workers and increasing managers will not solve any problems.
The USPS needs to enter the Banking business as has been proposed by the Board of Governors and rejected by the Postmaster General.

We are already leaving cages of committed Local Originating mail to process standard. Management just pull the tags out of the trays and mark the cage 2 day.
They've turned us into a skeleton crew, making 1 person run machines by themselves on all the machines.
This game plan is nothing new, they do the same thing when they want an operation to fail. They will throw up every roadblock to say it isn't working and we have new equipment or process to make it more efficient.
Instead of trying to kiss the butt of business, and trying to make the process cheap for them.
I told our MIPS 18 years ago we should be going after the online market. Sell money orders online( make money from the sale of the money orders and delivery option), Scan packages, sell advertisement postage ( sell a coke stamp that we could make money off advertising and from the sale). He looked at me with a you silly man look.
We should be look at businesses as a supplemental source of revenue, not the primary.

Consolidation is merely going to further cripple the postal service. Just another effort to dismantle this great institution.
Next on their list of things to do? Claim that they can no longer deliver box to box because of the disrepair of the fleet. - The fleet they have had 25 years to implement phased replacement of. How can they offer up a hard blow to the vehicle fleet? Require rural carriers to drive one - as if city delivery isn't hard enough on them.
Lets not overlook certain processing plants that have technically "closed" in phase 1, but are still processing portions of the mail - thus elevating the postal services numbers, artificially making the closings look great, until after the dust settles and the bottom falls out. Transporting mail hundreds of miles away from its destination, under a tight schedule, then returning it days later spells for even more disaster than just delayed mail.

The postal service is making a huge profit now since the y have not been paying the 5.7 BILLION in the retiree health fund for future employees. This is reason to stop the consolidations because the problem is not with the current mail processing framework but the passing of the bill mandating us to pay the pre-funding of health care benefits. Stop the Consolidations in my city of Norfolk, my sister city Roanoke ( both in Virginia) and across the nation. We can do better by following the OIG suggesstion of adopting Postal Banking and seeking other revenue sources rather than speeding to try and privatize the Post Office.
Charles Goldie Leavell President Norfolk Va Local 262

Valid point....for the 9 months ending 6/30/2014, the USPS ahieved a $1 billion profit before accounting for the pre-funding of retiree health benefits, Factoring in these benefits results in a $4.3 billion loss.

Enough plants are closed. Congress needs to do their job and pass productive legislation. Get rid of the current payments required by congress to balance the national budget. Pass legislation that allows the organization to remove the costly arbitration process in the contract that requires the organization to pay for union stewards. If the union paid for the time of its stewards it would reduce the grievance hungry stewards who make up issues that keep them from working. The teamsters protect their employees but it doesn't cost the organizations any time or money for them to represent the employees. Congress should solicit Input from Postal managers on ways to save the organization instead of pretending they know what's going on. The organization wastes millions of dollars on paying for union time that leads to unnecessary arbitrations costs. The plant I worked in spent over 2 million dollars on union time. That's paying employees their hourly wage to investigate, prepare and write grievances. Many stewards are paid 40 hours a week on union time and never do their job. It costs the organization more money to replace these employees who "never" do the job they were hired for.

In Chattanooga, TN the year that was used for the AMP feasibility study, we had a new roof installed that cost over $1 million. Plus that same year we also had a SPBS upgrade where they added 2 new sections to our SPBS machine and made various upgrades.
These were one-time dollar figures and should not have been included in the AMP study, yet the "results" showed some astronomical Maintenance savings that obviously were reflecting the costs, work hours, etc from these one-time instances.
If they only took out our AFC machines i "might" could see a small savings but even that is debatable.....but the figures they provided are very grossly inflated and i think our closure would end up costing them money.

These closures will lead to the degrading of service and service standards. This will ultimately result in the loss of consumer confidence in our trusted organization and will drive some customers to our competitors. The real issues that must be addressed is the onerous pre-funding mandate required of no other business or federal agency. Congress must address and correct this mandate and the PMG should focus all of his resources and energy towards that end.

Why is every body in such a hurry to put people out of work?
Making cheaper non-postal employees to do the work will not make the mail go faster nor will it bankrupt the Postal Service!
Why is it so important to eliminate fast service for the public. Standing in line waiting is no fun!

In the Alabama District where I work the Huntsville processing plant was shut down and the workload was transferred to Birmingham. Immediately our Office was affected as our incoming mail was not being delivered to us on time. This created a snowball effect as it ultimately lead to mail being delivered to our customers later in the day. There were many days when we would receive First Class Mail and Parcels after 8:30 AM. Local Management made a decision to partially reopen the Huntsville Plant but failed to staff it properly and it still lead to a positive effect on our mail stream from arrival to our Office to the street delivery. Now there is talk that the facility is once again closing. Which again will affect our customers.
One would think that downsizing would affect everyone, but that is not the case with Postal Management. Matter of fact they are creating more managerial positions while cutting workers.
Yes Congress is partly to blame for the financial problems which the Post Office faces. But the main reason for the financial losses are due to Upper Managements wasteful spending, poor decision making and overpaid salaries.

A big NO to consolidation of plants. It will slow down the mail and cause job losses when they are needed the most. Postal employees, for the most part, are hard working family people. The security of our jobs, health benefits and pay are what keep us going through all of the managerial changes in a never ending circle. Most supervisors and postmaster say or do anything they have to in order to stay in their office.
The staffing at local level post offices are cut to the very marrow of USPS' hardest workers bones! Clerks and letter carriers are the very backbone of this once great postal service. The current PMG and senators are picking us to pieces bit by bit. Congress must remove the pre-funding of health and retirement benefits for the employee 75 years in the future. And all within a ten year span at the cost of over 5 billion dollars a year. There is no other company, be it private or government that has this requirement hanging over their heads.
Most people say just close the plant and let the employees go to another. Problem is there are no other processing plants in close range to go to. Most families would have to move at least five hundred miles away, if not more. Then there's no guarantee of a long term job because that plant might be closed in the next wave. And it doesn't stop with the families. The little corner store, the schools, health facilities and the housing markets all suffer.
It is a vicious circle that hurts the employees and the citizens that we know and serve.
Please stop these consolidations and closings.

I believe ALL mail processing should be returned back to the original processing plants. All mail is being DELAYED period.
My homeowners insurance was canceled due to the company not getting the payment on time. It was mailed 10 days before the due date and was only going from Lafayette, IN to Chicago, IL. Unacceptable service! I can not believe trucking mail hundreds of miles to be processed and than back to be delivered is saving the USPS any money. If USPS continues with the consolidation plans they should take Service out of its name.

The last consolidation delayed my first class city utility bill delivery from 1 day before consolidation to 7 days after dropped off at the post office. Instead of the estimated 200,000 plus city water bills being dropped at the P&DC, being sorted locally, and then travelling about 7 miles around to multiple P.O.'s my bill now travels a minimum of 20 miles and up to 150 miles each month depending on which facility is processing our mail. When it goes 75 miles south of me it takes about a week to get my first class mail. They don't need to close down 2 of the 3 remaining facilities in my area when I can't even get my mail now in a reasonable time frame.

I would also add that not only does the cuts not make common sense, these cuts do not take into consideration the way a state or area of a state (like NW Washington State) is formed. I believe some decisions are made on the mileage as a crow would fly. It might only be 10 miles from Seattle to Kingston/Bremerton/Pt. Townsend (and all the other Peninsula Post Offices) using the a crow, airplane or ferry system, but the mail would actually travel four times that to go around the Puget Sound if the Tacoma Plant was closed. NW Washington mail would need a two to four day delivery if the Tacoma Processing and Distribution Center (P&DC) was closed and none of USPS Mail Delivery Standards would be met.
Robert

I got a way the PO could save millions..I've worked flats for 30 years & every single night we have to run 40-80 EMM trays of so called letters or aka "Fletters"..Mmail that's 10&1/2 inches long by 6" high..They get the letter rate & we have to run it on the FSM and the carrier then has to case it..Then spend overtime $ to run the standard flats because we spent so much time running letters that the DBCS'S WILL NOT RUN..Make the mailers reduce the size so it will run on DB's or charge them the flat rate not letter rate..Nationwide I'm sure it adds up to millions..

Eventhough the mailpieces show a letter rate, the letter rate should have been adjusted to a flat rate by the BMEU clerk when inducting the mailing. This could have happened eventhough the mailpieces are still showing a letter rate.

You are missing the point moderator. The OP was correct in his statement. These "fletters" are within the dimensions that qualify for automated letter rate. Height, width, length, paper weight etc. The problem is that even when these mail pieces are within the parameters they will not run on the vast majority of automated letter equipment when mixed with different size pieces of mail. They may make one run through a machine, but to be DPS'ed they must make a minimum of 2 passes through a machine, and they will not make two passes. They jam, cause sequencing issues, reduce the overall percentage of DPS mail due to spoilage on jams and decrease the overall quality of the DPS. So, we take tens of thousands of pieces daily(per plant) and run it through our Automated flat process, which creates the need for more man-hours downstream (except in those few areas served by FSS) The engineers involved in mail design and acceptance need to go to plants around the country and get a true picture of what will actually run through machines. The revenue and man-power lost on this daily nation-wide is huge.

Just another example of an individual (PMG) trying to privatize so prices go up, driving business away so that others reap the profit. The problem with the USPS is congress and the hugely ill thought out pre funding fiasco. Those with a little intellect know that the pre funding was a ploy to show more income to government thereby reducing deficit numbers. Why is it that when the government actually has something that works right the consuming thought is to destroy it? Every business has failures, the USPS is no exception , but by and large it works and works well, regardless of the negative media given it. No business EVER made revenue go up while at the same time degrading service. A small but effective example is the "removal" of Post Office collection boxes. I overhear everyday from all sorts of people complaining that they would send more letters but can drive around for an hour before they find a blue box!!! (loosing revenue due to "consolidation" !!) Seems mundane but in a small way just the same.
Congress can help by lifting certain restrictions so that the PO can better compete and foremost by ending the pre funding lunacy. The PO can help by "consolidating" all the unnecessary and burdensome management structure. (Remember that one of General Motors problems was that it was way too top heavy. Maybe PO should learn from that!!) I would rather see more carriers and less people following them around with clipboards if it meant better service and faster service.

I understand the reaction to consolidate, but the USPS has already consolidated distribution facilities before. Why is the USPS not trying to increase revenues and customer convenience. Why can't the post office open a little earlier and stay open a little later. Why can't they have more Saturday hours. The USPS advertises about package growth. Well sometimes I need to pick up my packages after work or before work or on Saturday and their window hours are more for their convenience and not their customers. I have been told by clerks in my city that they are in the building and the retail window could be open for customers. Why not do it.

The downturn has stopped. Most recent data shows break even with an increase in parcel service. Closures already done have stretched the PO thin but those currently on proposal will take the service out of USPService. One example is Roanoke VA. If they consolidate that facility as planned, that takes distribution away from the entire southwestern area of VA. That is a large geographical area that is increasing in population density and of mountainous terrain strongly affected by weather conditions. Projections are just numbers and they can and do change. Closing these facilities is a finality that will have long reaching repercussions on communities and their local economies, far beyond the facilities themselves.

We have just been informed our post office in Pine Mountain Club Ca 93222 is being closed. We are a mountain community of 2,315 population. We have never had delivery and must go to our town PO. The...

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